Alibaba places HK$80B new shares with 100% of proceeds to full-stack AI
Alibaba announced on Aug 23 placing 710M new shares at HK$112.70 to raise HK$80B, with 100% of net proceeds committed to full-stack AI capabilities and infrastructure.
On August 23, Alibaba announced on the Hong Kong Stock Exchange a HK$80 billion new share placement. The company will issue 710 million new shares at HK$112.70 per share, with closing expected on August 26. Net proceeds of approximately HK$79.7 billion after expenses will be directed entirely to the group's full-stack AI business.
This marks Alibaba's first major follow-on share placement since its 2019 Hong Kong dual listing, setting a record for the largest primary follow-on offering in Hong Kong history and ranking as the world's third-largest equity placement in 2026. The placement targets non-US institutional investors offshore under Regulation S of the US Securities Act and will dilute existing shareholders by approximately 3.8%.
The announcement specifies that net proceeds will cover four areas: AI compute infrastructure expansion, large model iteration R&D, T-Head (Pingtouge) self-developed chip refinement, and industry AI commercialization support. The placement was oversubscribed within an hour of opening, with sovereign wealth funds and high-quality long-term international capital as the main underwriters.
Following the announcement, Alibaba's Hong Kong-listed shares fell 8.5% on the August 24 open, the steepest one-day drop since early 2025. The contrast between strong demand and short-term price pressure reflects market acceptance of the long-term AI strategy but concerns over dilution. As of June 30, 2026, Alibaba held approximately $46.5 billion in net cash. AI investment pressure has already driven quarterly capital expenditure up 75% year-over-year to RMB67.678 billion, with free cash flow outflow widening to RMB44.670 billion.